The NBN levies a connectivity charge, the CVC, which retailers purchase in 100 megabits per second Mbps, as well as a second access charge, the AVC. These charges apply to each individual subscriber that the ISP retailer signs up.

“At the moment, with the CVC and AVC charges, the pricing structure discourages people going higher speeds because it’s too expensive. Some players have cheaper products, like a $29.99 per month price point. But that’s ridiculous and it’s only a speed of 12Mbps download and 10Gigabytes of data. That’s not what the NBN is about, you get more data on your phone.”

MyRepublic is offering a trial retail package at a site near Wollongong, called Gigatown, where a 1 gigabyte download speed is being offered for $129.99 per month.

Mr Demos says customers seem willing to pay this for better speeds.

“NBN Co has acknowledged its pricing model is wrong,” Mr Demos says. Retailers can now get discounted CVC fees, which he says demonstrates that the NBN Co knows the model is not working.

“We know NBN Co is looking at it because they’ve acknowledged the pricing model needs to be changed,” he said.